Shedding Light on Clinical Trial Risk Management

The Danforth Digest: Quick takes on running the business of life sciences

For companies entering clinical development or already conducting later stage trials, the importance of robust risk management and insurance strategies cannot be overstated.

View a conversation between Gregg Beloff, Co-Founder and Managing Director; and Ed Downey, Head of Enterprise Risk Management; for high-level guidance and insights.

Gregg Beloff: Let’s discuss how you approach risk management for companies preparing to initiate their first clinical trial. Why is early engagement crucial in this context?

Ed Downey: When a company is planning its first clinical trial, it is essential to engage early in the process. One of our primary roles at Danforth is to provide information that helps our clients determine which countries they should consider for their trials. Insurance procurement can vary significantly between countries, so being involved from the planning stage is essential. For instance, getting insurance in France can take as little as two weeks, while in Brazil, it might take up to six months. This information is invaluable for decision-making.

Gregg Beloff: Can you share more about the potential delays in certain countries and how they impact clinical trial planning?

Ed Downey: Some countries, like India, require prepaid policies, leading to a lengthy payment process. This delay could affect trial timelines significantly. It’s essential to inform the client operations team about such delays so they can plan accordingly. For instance, if a company plans a trial in Ukraine, they should be aware of the war risk exclusion and potential logistical challenges due to the ongoing conflict.

Gregg Beloff: You mentioned the importance of aligning local and U.S. insurance policies. Could you elaborate on how you advise companies with ongoing clinical trials in this regard?

Ed Downey: Certainly. It’s crucial to ensure that both local and U.S. insurance policies complement each other. Given statutory requirements, payments often cannot be made directly to individuals or countries. Instead, insurance companies pay each other to avoid complications. We also need to ensure that the policies are adequate and that adjustments can be made if needed due to changes in patient enrollment.

Gregg Beloff: Expanding on the topic of patient enrollment, how does exceeding the patient count affect clinical trials, and what measures can be taken to address it?

Ed Downey: Exceeding the patient count can lead to issues, as treatment cannot proceed if insurance lapses or the enrollment cap is breached. It’s critical to have this information in advance to prevent disruptions. During the COVID-19 pandemic, we adapted policies to allow patients to access care remotely or through alternate treatment centers, showcasing the flexibility of insurance policies.

Gregg Beloff: For companies considering conducting trials in multiple countries, what are the key considerations regarding insurance and risk management?

Ed Downey: When expanding trials internationally, consider insurance availability at each site and whether the Principal Investigators (PIs) have coverage. Negotiating indemnification agreements is often necessary, as some countries may want the biotech company to assume all liabilities. It’s crucial to assess these factors and avoid assuming the liability of medical professionals for actions outside the protocol.

Navigating risk management and insurance in clinical trials is a complex endeavor that demands careful planning and expertise. At Danforth, we recommend early engagement so that companies can understand the nuances of insurance procurement in different countries, and the need for synchronized insurance policies. These factors are essential for successful clinical trial execution, ensuring the protection of patients, companies, and the integrity of the research itself.

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